Investors Asked to Weigh in More on Advisers, Broker-Dealer Conduct

When it comes to the type of advice investment advisers and broker-dealers give, the SEC wants to know if new rules are needed to ensure that the information they’re sharing fits with their clients’ needs.

To that end, the agency is asking investors for data and other information to assist it in considering whether to make new rules about the standards of conduct and regulatory obligations for broker-dealers and investment advisers when they provide personalized investment advice about securities to retail customers.

“Studies have shown that few investors realize that the standard of care they receive depends on the type of investment professional they use. And often, investors do not know which type of financial professional they are relying on,” said SEC Chairman Elisse Walter.

This request for information will help the SEC in its ongoing consideration of alternative standards of conduct for certain broker-dealers and investment advisers, as well as potential harmonization of other aspects of regulation in this area, Walter added.

While the SEC said it is particularly interested in receiving empirical and quantitative data and other information, all interested parties are encouraged to submit comments, including qualitative and descriptive analysis of the benefits and costs of potential approaches and guidance.

The SEC said it recognizes that retail investors are unlikely to have significant empirical and quantitative information, and welcomes any information they would like to provide.

The public comment period will remain open for 120 days following publication of the request for feedback in the Federal Register, the SEC said.